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The Role of Cargo Maritime Transport of Goods with Focus on the Transportation Corridor Between Southeast Asia and Northwestern Europe

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The Role of Cargo Maritime Transport of Goods with Focus on the Transportation Corridor Between Southeast Asia and Northwestern Europe SHS Web of Conferences 92, 09010 (2021) https://doi.org/10.1051/shsconf/20219209010 Globalization and its Socio-Economic Consequences 2020 The new “global”: the role of cargo maritime transport of goods with focus on the transportation corridor between Southeast Asia and Northwestern Europe Marek Minárik1,*, and Denisa Čiderová1 1University of Economics in Bratislava, Faculty of Commerce, Department of International Trade, Dolnozemská cesta 1, 852 35 Bratislava 5, Slovak Republic Abstract. Research background: Our research is framed by the new institutional theory reflected in: the property rights theory [1] and transfer of ownership of goods and the transaction costs theory that might be associated with economic exchange theory. Overall, we need to consider occurrence of deglobalization and the COVID-19 crisis, which recently not just decelerated growth of the world economy, but even put it to a halt; one might conclude that (de)globalization [2] and the COVID-19 crisis are behind the new “global” [3]. Purpose of the article: We investigate the impact of connectivity between selected countries by cargo maritime transport on costs to import of 1 TEU container transporting a specific commodity in a specific transportation corridor. Methods: Our research is based on a regression analysis creating a model of UNCTAD statistics; the Liner shipping connectivity index (LSCI); and the WEF Global Competitiveness Index (GCI). We consider the Belt and Road Initiative (BRI) that converges with the global maritime transportation corridor between (Southeast) Asia/China – Northwestern Europe/EU (the North Sea Region) in this respect, bearing in mind the 2017 round of the International Comparison Program recently released by the World Bank. Findings & Value added: Our research reveals correlation of the costs to import of 1 TEU container vis-à-vis the quality and intensity of liner shipping connections and the quality of the business environment determining the transaction costs in import price. Value added of the paper is our focus on sustainable development reinvigorated by prestigious international organisations and European Union institutions. Keywords: (de)globalization; Belt and Road Initiative (BRI); cargo maritime transport and maritime ports; TEU container; theory development (theory of ownership/property rights; transaction costs theory; contract theory) * Corresponding author: [email protected] © The Authors, published by EDP Sciences. This is an open access article distributed under the terms of the Creative Commons Attribution License 4.0 (http://creativecommons.org/licenses/by/4.0/). SHS Web of Conferences 92, 09010 (2021) https://doi.org/10.1051/shsconf/20219209010 Globalization and its Socio-Economic Consequences 2020 JEL Classification: F14; F60; M21; N75; R40 1 Introduction Maritime transport has been a major driving force behind international exchange of goods throughout the history of the mankind, but particularly since the Ocean Age [3]. Nowadays, the biggest maritime ports of regional just like global importance are located in Southeast Asia and Northwestern Europe, which converge with the Chinese One Belt, One Road (OBOR) initiative (alias the Silk Road Economic Belt and a Maritime Silk Road, later reformulated as the Belt and Road Initiative – BRI). Considering the purpose of our paper (to investigate the impact of connectivity between selected countries by cargo maritime transport on costs to import of 1 TEU container transporting a specific commodity in a specific transportation corridor) and the fact that over 130 countries have signed a Memorandum of Understanding to join the BRI, in our article oriented on the maritime transportation corridor between Southeast Asia and Northwestern Europe we focus within the BRI on East Asia & Pacific and Europe & Central Asia only. On the one hand, Southeast Asia is in our focus within East Asia & Pacific (BRI) represented by: China (ports such as Shanghai, Ningbo-Zhoushan, Qingdao, Tianjin, Xiamen, Dalian, the port of Hong Kong), Taiwan (port of Kaohsiung), Singapore, South Korea (port of Busan), Malaysia (port of Tanjung Pelepas), Thailand (port of Laem Chabang), Vietnam (port of Saigon Ho Chi Minh City) and Philippines (port of Manila). On the other hand, Northwestern Europe is in our focus within Europe & Central Asia (BRI) represented by: Belgium (ports such as Rotterdam and Antwerp), Germany (ports such as Hamburg and Bremerhaven), the United Kingdom (ports such as Felixstowe, Southampton and London) and France (port of Le Havre in the North Sea region). Based on data from the recently released World Bank International Comparison Program (2017 edition) [4], the cumulative share of these countries from Southeast Asia and Northwestern Europe in world total GDP (PPPs) and population terms is 31.2% and 27.3%, respectively. Their individual GDP per capita (PPPs) is in the interval between 43.3% and 566.3% (world = 100). Analogically, heterogeneity of both groups of countries (covered in detail in Table A-1 in Annex) is further demonstrated by their ranking on the scale of: the 2017-2018 Global Competitiveness Index [5] launched by the World Economic Forum four decades ago and monitoring competitiveness, as well as the 2017 SDG Index [6] mapping sustainability, which was defined by the United Nations’ World Commission on Environment and Development in 1987. According to the World Shipping Council [7], the trade corridor between Asia and Northern Europe records 15 063 000 TEU containers in total. Focusing on the direction of the container flow, we claim that the westbound direction with 9 924 000 TEU containers counts with much higher transport performance than the eastbound direction with the 5 139 000 TEU containers. These data confirm the fact that the world production area is located in the region of Southeast Asia and one of the consumption areas is located in Europe. One of new ideas in logistics is the batch size one production based on 3-D printing, top- level robotics and automation. 3-D as an example of the new “global” will increasingly have an impact on transport [8] and new logistical methods will result in modified transportation of goods [9]. This article deals with the issue of the costs to import 1 TEU container. We identify these costs with the freight rates or quotes. Eurosender [10] is a modern digital platform, which combines advanced possibilities of automation, enables companies to create their own digital logistics departments and to raise their performance. There are several components to calculate the rates for transporting goods by sea such as the size and weight of transported goods (dimensions), distance (lower rates for long-haul 2 SHS Web of Conferences 92, 09010 (2021) https://doi.org/10.1051/shsconf/20219209010 Globalization and its Socio-Economic Consequences 2020 shipments), inland transportation for connecting the port to delivery address (pick-up and delivery), the nature of goods (type of item), extra coverage for additional protection of cargo (insurance), customs clearance (fees for international maritime cargo shipments) and Incoterms clauses. Analysis in Table A-2 in Annex is based on strengths and weaknesses of the maritime transport modality. E.g. modern maritime transport is less problematic than the air transport in terms of environmental impact, which relates mainly to the carbon footprint and CO2 emissions [11]. 2 Research background 2.1 (De)globalization and the COVID-19 crisis Globalization represents one of key concepts in the 21st century and it will undoubtedly continue to be analysed. Due to intensifying interdependence of countries and communities, globalization as a multi-dimensional process is characterised by: “the acceptance of a set of economic rules for the entire world designed to maximise profits and productivity by universalising markets and production, and to obtain the support of the state with a view to making the national economy more productive and competitive; technological innovation and organisational change centred on flexibilisation and adaptability; the expansion of a specific form of social organisation based on information as the main source of productivity and power; the reduction of the welfare state, privatisation of social services, flexibilisation of labour relations and weaker trade unions; de facto transfer to trans-national organisations of the control of national economic policy instruments, such as monetary policy, interest rates and fiscal policy; the dissemination of common cultural values, but also the re-emergence of nationalism, cultural conflict and social movements.” [12]. Thus, besides economic [13] and political [14] aspects globalization relates to a spectrum of features. Currently, in the context of globalization theory there are several approaches: World-System Theories; Theories of Global Capitalism; The Network Society; Theories of Space, Place and Globalization; Theories of Transnationality and Transnationalism; Modernity, Postmodernity and Globalization; and Theories of Global Culture. Moreover, we can differentiate: Theory of Liberalism; Theory of Political Realism; Theory of Marxism; Theory of Constructivism; Theory of Postmodernism; Theory of Feminism; Theory of Transformationalism and Theory of Eclecticism (as globalization theory categories listed on the Political Science website and cited in [12]). Among key theorists of globalization let us focus on the view of the 2001 Nobel Prize laureate J. Stiglitz explaining the new status quo of today’s fast-changing world:
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